The Vancouver City Council on Monday approved the sale of a downtown parking garage which has been operating at a net loss for years.
The council declared the 207-spot parking garage, 1111 Main St., as surplus property in December to pave the way for its sale for $1.1 million but decided to hold off and get a second appraisal. The council on Monday approved a sale price of $1.26 million.
The buyer is Main Place of Vancouver, a company which owns the adjacent Main Place office building. The company approached the city last year about buying the garage, which the city built in 1991 to attract commercial economic development downtown.
Since building the garage, however, the city's policy on public parking services has changed from attracting businesses to attracting patrons to "shop, dine, recreate and be entertained."
The Main Place Garage, according to a staff report by City Manager Eric Holmes, "almost exclusively serves" the employees who work in Main Place and other nearby businesses. "Main Place Garage loses money each year and is almost exclusively operated as a commuter facility. Despite the fact that there has been no net income generated on this facility since the initial investment, it has fulfilled an economic development goal established in 1991," Holmes wrote.
The city has leased parking spaces to Main Place tenants and other nearby business owners. But the garage has operated at a net loss, ranging from $332,930 in 2006 to $63,296 in 2012, according to an earlier report prepared by Holmes.
In 2011, the garage lost $128,427.
The initial $1.1 million sale price was criticized because of the gap between assessed value and market value.
The Clark County Assessor's Office assessed the land value at $24 per square foot ($546,070) and the garage at $2.6 million for a total value of $3.1 million, Assessor Peter Van Nortwick said in December.
Lloyd Tyler, the city's chief financial officer, told the council last year that, as with any business, the key factor in determining market value is how much revenue can be generated.
The city posted the garage for sale for 90 days and did not receive additional offers.
With the sale, the parcel will return to the county's tax database, Holmes wrote in his report. He said revenue from the sale will retire approximately $716,000 of debt service owed to the general fund and give a $544,000 boost to the parking fund.
Had the city decided to keep the garage, its debt would have been paid off in 2017. Starting in 2018, the garage's annual projected net income was $80,000.
Monday's decision was unanimous, with councilors saying they were glad the city took additional time to get more information.
Stephanie Rice: 360-735-4508 or firstname.lastname@example.org.